UPDATE 4-Campbell Soup profit beats, but firm keeps 2013 outlook

Feb 15 (Reuters) - Campbell Soup reported a
higher-than-expected profit for its fiscal second quarter on
Friday but did not raise its full-year outlook, saying the back
half should bring a steeper tax rate and smaller boost from
share buybacks.

Shares of the company were up 1.4 percent in afternoon
trade. They jumped as much as 6 percent on Thursday after news
of a buyout of rival H.J. Heinz sparked hopes of other
acquisitions in the packaged foods industry.

Campbell, which Wall Street has long viewed as a good
partner for Heinz, said it has been trying to be more active in
terms of mergers. If an opportunity to fill a hole in its
portfolio presented itself, the company would be interested,
said Chief Financial Officer Craig Owens.

Net income was $190 million, or 60 cents per share, down
from $205 million, or 64 cents per share, a year earlier.

Excluding restructuring and other charges, earnings in
Campbell's fiscal second quarter, ended Jan. 27, were 70 cents
per share. On that basis, analysts' average forecast was 66
cents, according to Thomson Reuters I/B/E/S.

Campbell, the world's largest soup maker, stood by its
forecast for fiscal 2013, which calls for earnings of $2.51 to
$2.57 per share on sales growth of 10 percent to 12 percent.

The company, which has been trying to reverse weak soup
sales with new products, spent less on advertising in that
business. One analyst called that "a ticking time bomb."

"We have seen many food companies in the past cut
advertising spending as a percentage of sales," said JPMorgan's
Ken Goldman, "and while it usually helps boost (earnings) in the
near term, it almost always leads to eroded brand equities and
lower sales in the long term."

While Campbell may be spending less in some areas, it said
it is spending more efficiently, noting that sales of its Chunky
soups were up despite the reduction in ad spending.

The company said its baked goods business benefited in the
quarter from the bankruptcy of Hostess Brands, which resulted in
an absence of that company's products.

The shares were up 49 cents, or 1.3 percent, at $39.21 in
afternoon trading on the New York Stock Exchange.